Kitchen v. Reinsky

• Decision Date: 31 March 1868
• Citation: 42 Mo. 427
• Parties: ZIBA H. KITCHEN, Respondent, v. FREDERICK REINSKY and JAMES BROWN, JR., Appellants.
• Court: Missouri Supreme Court

42 Mo. 427

ZIBA H. KITCHEN, Respondent,

v.FREDERICK REINSKY and JAMES BROWN, JR., Appellants.

Supreme Court of Missouri.

March Term, 1868.

Appeal from St. Louis Circuit Court.

Defendant at the trial asked the following instructions which were refused by the court: “1. The assignment of Cochran & Pollack to Stewart and Fiske was inoperative to pass any title to the land in question. 2. The deed of Stewart and Fiske, acting as assignees of John Cochran in New York, to the plaintiff, was inoperative to pass any title to the land in question. 4. The admission made by plaintiff's attorney at a former trial of this cause, and made of record, that ‘Cochran was insolvent when he made the assignment,’ then and now offered in evidence, and ‘that the same was made to hinder and delay creditors,’ and ‘that it was void,’ and ‘plaintiff's claim under said assignment was void,’ is conclusive against the plaintiff, and he is estopped from claiming any title under said assignment.”

The third instruction asked by defendant was given by the court, as follows: “3. Defendants' title relates back to the 2d of March, 1860, to the date of the attachment and levy at the suit of Robinson & Parsons against Cochran, and the conveyance of Cochran to plaintiff, dated September 1st, 1860, was inoperative to pass any title to the land in question as against the purchasers under the attachment sale.”

John. P. Hudgens, for appellants.

The first and second instructions asked by defendant and refused by the court comprehend the entire issue involved in the case, and are in brief--1. Did the foreign voluntary assignment of Cochran & Pollack, made in the State of New York, without any compliance with the lex loci rei sitæ, pass title to the assignees, Stewart and Fiske, to land in Missouri, belonging to John Cochran? 2. If the first proposition be affirmed, then did the deed of the assignees, Stewart and Fiske, made in New York, “under and by virtue of the assignment,” and as such assignees, to the plaintiff, without any pretense of compliance with the lex loci rei sitæ, which requires the filing of an inventory and bond in the St. Louis Circuit Court, and procuring an order of the same as a prerequisite to their right to sell and convey realty under the assignment, pass any title to plaintiff?

I. There are two classes of assignments known in law 1. Statutory or bankrupt assignments. 2. Voluntary assignments. Both are for the benefit of creditors, and governed by the same rules as it respects real estate. The latter is a substitute for the former. (Bur. on Assign. 5, 16; 2 Kent's Com. 532; 1 Sm. & M. 207, 258; 27 Mo. 528; Story Confl. Laws, § 423 a.) II. The lex loci rei sitæ governs all contracts for or conveyances of real estate, and unless such are made in conformity and compliance with the lex loci rei sitæ they are invalid. (Story Confl. Laws, §§ 435, 427, 428, 555, 363, 364; United States v. Crosby, 7 Cranch, 115; 10 Wheat. 192; 9 id. 566; 11 id. 465; 11 Mo. 318; Bur. on Ass. 360-2.)

III. The assignment of Cochran & Pollack is a “voluntary assignment,” within the meaning of “an act concerning voluntary assignments” in force in the State of Missouri at the time said assignment was executed, and as such must conform to all the provisions of said act as the lex loci rei sitæ governing in this case: 1. Because it purports on its face to be an assignment for the benefit of creditors to Stewart and Fiske “as assignees.” 2. The assignees accept the trust “as assignees” and “agree in all respects to conform to the provisions thereof under the law.” 3. It provides for the payment of six classes of preferred creditors with the residue to be returned to John Cochran. 4. The assignees, by their deed to plaintiff, declare that they make it as assignees under the assignment, and by virtue of authority under the assignment. (Manny v. Logan, 27 Mo. 528; 45 Barb. 317; 10 Paige, 461, 445-8; 7 Gill. & Johns. 480; 40 Penn. St. 269; 20 Ohio, 389, 400; 31 Mo. 301.)

IV. As a foreign voluntary assignment it was inoperative to pass title to land in Missouri, and the first instructions asked by defendants and refused by the court should have been given with a verdict for defendants. (Bur. on Ass. 360-2; Story's Confl. Laws, §§ 423 a, 428, 435; 3 McLean, 399; 18 Pick. 245-7; 10 Wheat. 202; 2 Ohio, 488; 11 Mo. 314-18; 7 Gill. & Johns. 480; 10 Iowa, 282; 6 Mo. 302.)

V. The second instruction asked by defendants and refused by the court should have been given. The deed of the assignees to plaintiff, made in New York, under proceedings in New York, without compliance with the provisions of the “act concerning voluntary assignments” in Missouri, as the lex loci rei sitæ, was inoperative and void: 1. Because the assignees took no title, by virtue of the assignment, to the land in question, and had no title to convey to plaintiff. 2. Because the assignees do not pretend to have filed an inventory and given bond to the Circuit Court of St. Louis county, nor procured an order from this Circuit Court for the sale, as an indispensable prerequisite to their right to sell or convey the premises in dispute; and such compliance with the lex loci rei sitæ must appear affirmatively, or no title can pass. (Manny et al. v. Logan, 27 Mo. 528, above referred to; Cleveland v. Boerum et al., 27 Barb 252; Story's Confl. Laws, §§ 435, 364-5, 424-7; 1 Pick. 81; 1 Paige, 220; 11 Am. Jur. 403; 1 Green, New Jer., 326; 16 Abb. Pr. 23--case in point.)

VI. The assignment is void by the statute of frauds both of New York and Missouri, because it creates a trust to the use of one of the assignors, John Cochran, without providing for the payment of all his debts. (R. C. 1855, p. 802, § 1; Rev. Stat., N. Y., 219-20, § 1; Bur. on Ass. 179, 430; 6 Hill, 438; 26 Mo. 423; 5 Cow. 584; 4 Comst. 211; 13 Wend. 243; Robinson v. Robards, 15 Mo. 459; Brooks v. Wimer, 20 id. 503.)

VII. The assignment is void because it appropriates the individual property of John Cochran to pay the individual preferred creditors of Pollack, and also of Abbott, to the exclusion of Cochran's individual judgment creditors. The property conveyed is described as follows: “All the real estate and personal property, of whatever description and wherever situate, etc., belonging to the said John Cochran and Robert G. Pollack, or either of them, or in and to which the said John Cochran and Robert G. Pollack, or either of them, have any interest, title, claim, or demand whatever, to have and to hold the same in trust, etc. * * Third, to pay off all the debts due and owing by the said firm of Cochran & Pollack, or the late firm of Abbott, Cochran & Pollack, or either of the members of said firms, to Cornelius Fiske.” Abbott is not one of the assignors, and no reason appears why his individual debts to Fiske or the other preferred creditors, without limit as to amount, should be paid out of Cochran's individual property to the exclusion of Cochran's creditors; and the provision is a fraud on Robinson & Parsons, under whom defendants claim as judgment creditor of Cochran. In Smith & Peters v. Howard et al. (20 How. Pr. 121), the court says: “This fifth clause authorizes and directs both the share of one of the assignors in the joint property and also his individual property, without regard to its value or to the amount of his individual debts, and without regard to the value of the property or to the amount of the individual debts of his co-assignor, to be applied to the payment of the debts of his co-assignor, for which neither he nor his property was liable at law or in equity, equally with his own just debts. It, in short, authorizes the property of an insolvent debtor to be applied in part to the payment of the debts of another person, and for which neither he nor his property is in any wise bound before his own just debts are satisfied. Such a provision, in an instrument like the one under consideration, affords a conclusive presumption of a fraudulent intent on the part of the assignors.” But the case before the court is still stronger. Cochran not only assigns his individual property to pay the individual debts of his co-assignor, Pollack, without limit or amount, but to pay the individual debts of Abbott, who makes no assignment, and the amount of whose individual debts is unknown, and that to the exclusion of Cochran's own individual judgment creditors. (1 Sandf. Ch. 348; 16 N. Y. 484; 24 id. 509; 3 Paige, 167, 517; 6 id. 19; 7 id. 26; 1 Story's Eq. Jur. 625.)

VIII. The assignment is void because it authorizes the assignees to compromise and compound all debts and claims due either member of the firms, or due by the firm, or either member of either firm, to themselves, the assignees, as preferred creditors--thereby placing it in their power to appropriate the whole assets, on real or fraudulent debts, of Abbott to either of said assignees. (9 Barb. 255; 4 Paige, 41; 11 Wend. 187, 203, 208.)

IX. The assignment is void because so admitted by plaintiff, and the court erred in excluding the admissions made of record. (1 Greenl. Ev. § 207; 3 Hill, 215; 1 Mees & W. 508; 42 Barb. 18; 5 Denio, 308; 6 Hill, 534; 8 Wend. 480.)

X. The third instruction asked by defendants and given by the court was correct. Defendants' title does relate back to the date of the attachment, March 2, 1860. This is five days subsequent to the recording of the assignment in the recorder's office of St. Louis county, and six months prior to the deed of assignees under the assignment to plaintiff, and to deed of Cochran to plaintiff, made at the same time, leaving the decision of the court pending on the validity of the assignment alone. (23 Mo. 85, 92, 94, 115; 17 Pick. 106.)

XI. The sheriff's return was sufficient-- Id certum est quod certum reddi potest. (Drake on Att. § 237, and authorities cited; 11 Pick. 341; 5 Me. 453; 2 N. H. 137; 9 Pick. 308; 33 Me. 141; 7 Johns. 217.)

XII. The proceedings in attachment and the judgment of the Common Pleas Court, under which ...